Life Insurance Terms Latest Update 100% Correct

Life Insurance Terms Latest Update 100% Correct Accelerated benefits rider may be added to a life insurance policy that permits the policy owner to "accelerate" or receive a certain percentage of the death benefit while the insured is still alive when he or she has been diagnosed with a terminal illness. Whatever amount is paid to the owner under the rider is subtracted form the face amount when death occurs and the remainder is paid to the designated beneficiary Accident an unforeseen, unintended, unexpected event, or fortuitous event that causes death, injury or damage Accidental Death and Dismemberment Insurance a form of insurance affording benefits in the event of accidental death; the accidental loss of sight, speech or hearing; loss of use of limbs (paralysis); or loss of member (arm or leg) Accidental Death Benefit a lump sum payment for loss of life due to an accident that was the direct cause of death. The cause of cause of death must be accidental for a benefit to be payable under the policy Accumulation Period the pay in period of an annuity during which the contract owner receives tax deferral. During this period the contract owner is referred to as the policyowner. Once this period end, the annuity phase or the income phase commences Actuary a person who calculate policy rates, reserves, and dividends and makes other applicable statistical studies and reports Additional Premium used in universal life policies. Can be paid into the policy account in an amount above the target premium. current tax laws limit the amount of excess cash value that can be accumulated in a life insurance policy. The insurance company may not accept the additional premium if it nears this limit without increasing the limit of life insurance (subject to underwriting) Address Change most states require that a producer notify the applicable regulatory department of any residence/business address change. And if a producer legally changes his/her name, notice of the change must be provided Adverse Selection the tendency of a disproportionate number of poor risks to seek or buy insurance or maintain existing insurance in force (the selection again the insurance company). Sound underwriting reduces adverse selection Age Based Penalty when an individual prematurely withdraws funds prior to age 59.5 from an annuity, a modified endowment contract, or a qualified plan, he or she will be assess a 10% penalty. No such penalty will be assessed if the distribution is made after this stipulated age Age Change the date halfway between bdays when the age of the applicant changes to the next higher age. With some insurers, the age is based upon the applicant's age at his nearest bday. In others, it is based upon the ages of his last bday Agent an authorized rep of an insurer who is licensed to sell life insurance and annuity contracts. Represents the insurer who sponsors him or her Alien Insurer an insurer organized under the laws of a country other than the US Annuitant the individual whose life the annuity is based. If the annuity is paid out for a lifetime, the annuitant's age is used to determine payments. The person who normally receives the annuity payment, however, that may not or may not be the case Annuitization the period for which annuity benefits are paid Annuity